Last May, there was a mobilization of Hanrine company workers against the National Police Command in Quito. The company has accused this institution and the Ministry of Government of not opening the public access road to one of the concessions, which is occupied by the inhabitants of La Merced de Buenos Aires, in Imbabura.
A police operation in July 2020 against the general manager of the Hanrine mining company - a subsidiary of the powerful Australian company Hancock with several concessions in Imbabura - was part of this invisible war. Three years ago, in 2017, Carlos De Miguel, -an Ecuadorian-American, former contractor of Senain during the Correa administration, expert in security of strategic areas and now mining investor- had made a millionaire offer for 51% of the Llurimagua copper project, which apparently the government of Lenín Moreno was offering to international investors.
The copper project, one of the most important in the world, had as partners at the time the National Mining Company (ENAMI) and Codelco, the Chilean state-owned copper company. The Chilean mining company, including through its government, reacted strongly against Ecuador and Hanrine's offer was left up in the air. But the Australian mining company insisted two years later, in 2019, once an Ecuadorian mining authority asked it to update its proposal, which this time even contemplated a copper refinery in the area, if Hanrine took over Llurimagua and completed a mining belt with sufficient mining capacity to justify the refinery.
The Moreno government dragged its feet, and what did happen was that in June 2020 Codelco sent a letter to Australia, copied to ENAMI, warning the company with legal action to defend its 49% stake in Llurimagua. Weeks later, Hanrine's manager and Hancock's representative was arrested by the police in an operation by the Public Prosecutor's Office, accused of trafficking in firearms, biological and nuclear weapons. For De Miguel, Moreno's government officials used the Police and the Prosecutor's Office in a business dispute, with the aim of discrediting him and benefiting third parties in the fight for Llurimagua, in the copper belt of Imbabura. This is the story.
I. The Chilean letter that was considered a threat
On June 5, 2020, the letter from Chilean state-owned Codelco - considered one of the largest mining companies in the world - tells Australia's Hancock Prospecting Pty Ltd the following:
"I am writing on behalf of the Chilean National Copper Corporation (Codelco).
As you are aware, Codelco is a Chilean state-owned mining company that has been conducting mineral exploration activities in Ecuador pursuant to various bilateral agreements between the Republics of Ecuador and Chile and with the National Mining Company of Ecuador (ENAMI EP), the state of Ecuador. mining property, since 2011.
"(a) on November 28, 2011, Codelco and ENAMI EP entered into an agreement granting Codelco preliminary mineral exploration rights in key regions of Ecuador; whereby the parties agreed to form a joint venture for the development of the project, with ENAMI EP holding a 51% interest and Codelco holding a 49% interest;
(b) on December 7, 2015, Codelco and ENAMI EP entered into an agreement for the development of the Llurimagua copper mining project in Imbabura, Ecuador (Llurimagua Project), which reaffirmed the commitment of the parties to enter into a shareholders' agreement by determining the main conditions that will regulate the
business relationship. ; and
(c) on March 29, 2019, Codelco and ENAMI EP entered into a new agreement adapting some details on the corporate structure of the joint venture to the latest opinion of the Attorney General.
These agreements confirm a long-standing relationship of cooperation in mining matters between the Republic of Ecuador and the Republic of Chile, a relationship that began in 2008, when both countries signed a Cooperation Agreement. As a result of this long-standing relationship, Codelco has made important investments in the Llurimagua Project.
However, correspondence was recently obtained between you and various entities in Ecuador in accordance with Article 18 of the Constitution of Ecuador and Articles 2 and 19 of the Access to Information and Transparency Law (Ley de Acceso a la Información y Transparencia) and Article 11 of its Regulations, whereby Codelco has learned that Hancock Prospecting Pty Ltd and its Ecuadorian subsidiary (jointly Hancock), have approached ENAMI EP, the Ministry of Energy and Non-Renewable Natural Resources (former Ministry of Mines) and other public officials on several occasions between October 2017 and December 2019 with an unsolicited offer to acquire the rights for the future development of the Llurimagua Project.
Hancock first approached the General Manager of Enami EP, Ministry of Mines and the President of the Republic of Ecuador in 2017 with an offer to acquire the rights to the Llurimagua Project. This offer was subsequently carried out in March and December 2019, where Hancock sought an official meeting to discuss its proposal on the Llurimagua Project. As a result of these communications, the Republic of Ecuador, through its Vice Ministry of Mines, sent official letters declining any offer and communicating the relationship with Codelco on the Llurimagua Project in accordance with current agreements entered into by Ecuador and Chile.
If any offer from Hancock were to be accepted, Codelco's continued involvement in the Project, as contemplated by the agreements set out above, could be terminated or otherwise impaired.
Under Australian law, knowing and intentional interference with another person's contractual rights is an economic tort sounding in damages. Based on the information available to it, including the official response from the Government of Ecuador, Codelco believes that, at the time of making its offer, Hancock had sufficient knowledge of the various arrangements governing Codelco's rights in relation to the Llurimagua Project to substantiate an intention to interfere with those arrangements.
Given the stage of the Llurimagua Project and considering the investments made by Codelco, any further action by Hancock would certainly constitute a knowing and intentional interference that could be extremely prejudicial to Codelco's contractual rights.
In light of the foregoing, Codelco requests that Hancock and any of its subsidiaries and/or affiliated entities immediately desist from engaging in any conduct that may interfere, directly or indirectly, with Codelco's contractual relationships related to the Llurimagua Project.
In addition, Codelco reserves all of its rights against Hancock with respect to any past or continuing conduct that interferes with its contractual relationships as set forth above, including its right to seek injunctive relief, damages and any other orders it deems appropriate in light of the circumstances.
Letter from Codelco to Hacock, warning that the Chilean state-owned company had the concession and an agreement with the government of Ecuador. View PDF
Hancock/Hanrine's response was terse: we take note of your communication; we reject all your claims.
Less than a month later, on July 12, 2020, Carlos de Miguel III, general manager of Hanrine - a subsidiary of Hancock, the world's largest Australian mining company - was arrested at his home in the valley of Tumbaco, northeast of Quito, at 7:00 a.m. and accused of trafficking in ammunition and firearms, biological and nuclear weapons. Ten months later, an Ecuadorian judge, at the request of the Ecuadorian Attorney General's Office, ordered the case to be closed and ordered the return of four weapons and 9,500 ammunition seized. De Miguel and his lawyer, Emiliano Donoso, are certain that this incident was a response to Hanrine's intentions and offers to buy the State's 51% stake in the Llurimagua mine, one of the world's largest copper deposits, which it holds in partnership with Chile's Codelco.
II. From document exchange to mining war?
Codelco's admonitory letter to Hancock/Hanrine was not the first from the Chilean state-owned company. It had done so three years earlier with the state-owned Empresa Nacional Minera (Enami) itself, in September 2017. A letter in an also admonitory tone. In short, the Chilean company told the Ecuadorian company, partners in Llurimagua, that it had learned that the national government of Lenín Moreno was bidding in London for mining investments in Llurimagua.
Letter from CODELCO to ENAMI, protesting that the government of Ecuador was offering Llurimagua to investors in London. View PDF
It stated that:
»Through various electronic media we have learned that at the end of last week and during the course of this week, the Minister of Foreign Trade of Ecuador, Mr. Pablo Campana Saenz, has held numerous meetings in London, England, promoting various investment projects in Ecuador, including the Llurimagua copper project.
"Among the meetings held by the Minister of Foreign Trade of Ecuador in London, there were meetings with the multinational mining companies Antofagasta Minerals (September 22), Anglo American (September 26) and Rio Tinto, in which the Ministry of Foreign Trade has delivered a brochure to these investors to invest in the Llurimagua Project (see attached). The same brochure is also included as a Project Sheet on the InvestEcuador website.
»The Llurimagua Project is described in the brochure as a project that integrates a copper porphyry and a copper refinery and smelter, with a total capital investment of USD 4,245 million. Regarding the business model, the brochure mentions that the Llurimagua Project is a public-private venture, where the future investor will exploit the mine and incorporate the copper concentrate as an input in the copper refinery. It is important to mention that InvestEcuador's brochure and website make no mention of the role of ENAMI EP, or Codelco, in the Llurimagua Project.
"We hereby wish to express our deep surprise and concern about the meetings that the Minister of Foreign Trade of Ecuador has had with mining companies in London -promoting investment in the Llurimagua Project- since, as is well known, the Llurimagua Project is protected by the Ministry of Foreign Trade of Ecuador, the Llurimagua Project is covered by the Agreement for Mineral Exploration signed between ENAMI EP and Codelco on November 28, 2011, later complemented by the Terms of Agreement of Shareholders signed between ENAMI EP and Codelco on December 7, 2015, hereinafter jointly the "Agreements", which had, in their signature, and as Witnesses of Honor, the Ministers of Mining of Ecuador and Chile.
»In Codelco's opinion, the discussions and meetings that the Ministry of Foreign Trade of Ecuador has had with mining companies in London (regarding the Llurimagua Project) deviate, not only from the Agreements, but also from the Letters, so Codelco requires a prompt, complete and satisfactory response from ENAMI EP regarding the scope of such discussions".
Hancock had made the offers, since 2017, covered by the fact that Moreno's own minister, Pablo Campana, had offered the complete Llurimagua package to international investors. An offer that did not mention that Ecuador already had a commitment with Codelco of Chile.
Hancock HAD MADE THE OFFERS, SINCE 2017, UNDER COVER OF THE FACT THAT THE MINISTER HIMSELF, PABLO CAMPANA, HAD OFFERED THE COMPLETE PACKAGE OF LLURIMAGUA TO INTERNATIONAL INVESTORS. OFFER THAT DID NOT MENTION THAT ECUADOR ALREADY HAD A COMMITMENT WITH CODELCO OF CHILE.
This story began a few years ago, when on November 28, 2011, the companies ENAMI EP and Codelco signed a Mining Exploration Agreement, which agreed that the Chilean company should assume the investment in phase 1 of exploration in a portfolio that would be agreed with ENAMI (which included Llurimagua, Sigchos, Quinapalma and Chileales). The Llurimagua project (formerly called Intag) had been the subject of an international arbitration, for which the Ecuadorian State was ordered to pay USD 20 million to Copper Mesa.
In the event of a favorable outcome, the companies were to (within Phase 2) incorporate a Mixed Economy Company, which would be subject to Ecuadorian regulations (incorporation, participation, taxes, mining and environmental regulations) and whose jurisdiction in the event of a dispute would be at the Permanent Court of Arbitration in The Hague.
On December 7, 2015, the same companies signed the Terms of Shareholders Agreement, which included a detail of the activities and investments to be carried out in Phases 1 and 2, as well as the administration, qualified majorities, operator, and the percentages of participation in the company to be constituted: 51% (ENAMI) and 49% (Codelco). As of 2019, Codelco had invested approximately USD 60 million.
However, on October 16, 2017, Hancock Prospecting PTY LTD submitted to ENAMI's General Manager a Letter of Offer to acquire the Llurimagua project and related interests. It did not receive any response from the Ecuadorian company. Prior to presenting itself as a company of Australian origin, with interests in various sectors and countries, it detailed a proposal to acquire 51% of the project as follows:
- A direct value of USD 102 million (based on information available to date).
- An additional value of approximately USD 100 million (through verification of proven mineral reserves and royalties in addition to those required by the Mining Law).
- In the event of a 100% transfer of the Llurimagua project, the values would increase proportionally, i.e., up to the sum of approximately USD 400 million.
On October 31, 2017, the General Manager of Hanrine Ecuadorian Exploration And Mining (Hancock's subsidiary in Ecuador) informed President Lenín Moreno of Hancock's interest in the Llurimagua project for USD 234 million (51% of the project), which was previously expressed to the Manager of ENAMI EP. The response arrived on November 6, 2017, indicating that it would be attended by the then Minister of Mines, Carlos Pérez, who never responded to the request.
On December 13, 2018, the Comptroller General's Office reported the provisional results of the special examination of the Llurimagua project, and pointed out multiple non-compliances with mining regulatory norms, as well as water and environmental protection, by the ENAMI EP-Codelco consortium (through its local subsidiary).
Weeks later, on December 28, 2018 and February 6, 2019, the State Attorney General, in response to a consultation submitted by the Minister of Energy and Non-Renewable Natural Resources; and a clarification consultation submitted by the Minister of Finance, absolved in a binding manner that: "the Company to be constituted between ENAMI and Codelco (regardless of whether it were mixed, anonymous or any modality) must maintain the 51% partition by the Ecuadorian State and may not be diluted. This hinders the ability to obtain risk capital for the future development of the project for values that would exceed USD 1,000 million".
Llurimagua mining project in Cotacachi. The photo is from October 2017 and was disseminated by the gubermental site El Ciudadano, before this media disappeared. The area has been the subject of disputes. Its inhabitants reject the concession and have been the target of persecution.
THE LLURIMAGUA PROJECT IS PART OF THE IMBABURA COPPER BELT. NEXT TO IT ARE LARGE DEPOSITS SUCH AS THE BUENOS AIRES AND CASCABEL ZONES. THIS IS AN AREA DESIRED BY THE LARGE MINERAL PRODUCERS.
Llurimagua is a mining project that, according to complaints from local residents and environmentalists, will have serious environmental impacts.
No more than three months later, on March 13 and 20, 2019, the General Manager of Hanrine insisted before the Minister of Finance and the President of the Republic, to assume the Llurimagua project. He ratified in the values proposed in 2017. He said that he was not opposed to the continuity of Codelco as partner and operator of the project. He even invoked the commitments made with the IMF regarding unproductive assets.
The only authority that responded to the communications and proposals presented by Hancock was the Vice Minister of Mines, Fernando Benalcázar. He did so on March 29, 2019, in a communication in which he limited himself to informing that the Llurimagua project and the commitments between Codelco and ENAMI, were part of the sphere of international law. And that it would be developed by a "joint stock company" formed by 51% in favor of ENAMI and 49% in favor of Codelco, in accordance with a "binding opinion" of the State Attorney General.
Since then, Hanrine insisted with various government authorities to be allowed to explain the offer, including the President of the Republic.
II. Carlos De Miguel accuses
On Monday, May 17, 2021, one week before the end of Lenín Moreno's administration, Carlos de Miguel and his lawyer Maximiliano Donoso announced that on May 7, 2021, Giovanny Fernando Freire Coloma, Judge of the Criminal Judicial Unit based in the Iñaquito Parish of the Metropolitan District of Quito, ordered the definitive filing of preliminary investigation No. 170101820073189 against De Miguel.
In a press conference, to which he had also invited people who supported him, the businessman - in one of his few public interventions - testified what he had lived in those ten months.
"On Sunday, July 26, 2020, at 07:00 a nightmare began that robbed me of my peace and tranquility for the next ten months, the result of a conspiracy of corrupt officials of this government.
"This act of cowardice, led by María Paula Romo, cast doubt on my integrity and that of my company, in front of the national and international community, especially in the United States, Australia, Europe and Canada. That day, my home was raided while I was resting with my wife, in the middle of a pandemic, because supposedly an anonymous source had reported 24 hours earlier that inside my home there were weapons and ammunition that would be used to commit crimes.
"I was abruptly detained by members of the Weapons and Ammunition Investigation Unit (UIDAM) who very creatively placed the ammunition to take the photo, which shows that this was a premeditated attack, where the Unit knew that these images were going to resonate to the other side of the world, to Australia, and they wanted worldwide recognition of those facts, because it has never been seen in Ecuador a police unit that uses evidence of any kind to mount images for self-promotion.
"While they raided the house and had me apprehended, from 07: 29, in command there was a prosecutor who ignored at all times my weapons permits and discharges, and who only repeated that it was an operation ordered by the police high command, I was put into a patrol car, I heard all the time the phrase "minister" among the same police officers, they threatened me all the way, under the command of Lieutenant Ricardo Herrera and put in prison for more than 30 hours, without a court order, alleging that I had committed a flagrant crime and alleged illegal possession and trafficking of firearms, chemical, nuclear and biological weapons, while the Minister of Government, desperately pressured judges and prosecutors, even before my hearing, asking for my head, my imprisonment and my prosecution, in a public and brutal smear campaign against me.
This is the slide that the businessman presented as one of the "outrages" against him. 4 sporting guns with all permits. 1 laser training pistol and 1 air shotgun that do not require permits.
THE TRUTH IS THAT ALL THE WEAPONS IN MY POSSESSION WERE REGISTERED IN MY NAME AT THE JOINT COMMAND OF THE AIR FORCES AND WERE USED, AS THEIR PERMITS STATED, IN SHOOTING COMPETITIONS: CARLOS DE MIGUEL.
"The truth is that all the weapons in my possession were registered in the joint command of the Armed Forces in my name and were used, as their permits said, in shooting competitions; I do not sell weapons or ammunition of any kind and I have shown with evidence that none of the sporting weapons I use have been or are linked to any crime, or are exclusive endowments of military and police. All this was known by the Police and the Minister before mounting this public circus".
"I consider it a great dishonor to my person to have to prove that I am not a trafficker of firearms, chemical, nuclear and biological weapons, as I was illegally accused. I have no criminal record of any kind, I have a prestigious university degree in Business Administration, I have worked in six continents with four of the largest transnational corporations in the world, with an unblemished professional career of more than two decades. I have never taken refuge in the right to silence and it has cost me, and my family, unquantifiable sacrifices for the continuous restoration of my honor".
"Ten months later, María Paula Romo, Lieutenant Ricardo Herrera, a former Vice Minister of Mining and at least one Police General, all interested in my detention and my discredit, deserve the attention and energy of criminal and civil justice, both national and international, and moral censure for their illegal acts. They will have to be held accountable before the ordinary justice system for the premeditated and illegal attack against me for their personal interests".
"Why did they attack me? I am a representative in Ecuador of one of the most important companies in the world in the mining industry and I expressed our real interest to the government, in writing, about the Llurimagua mining concession, for more than 400 million dollars, without counting royalties, taxes, studies... Income that would have been essential in the crisis we are going through. The few favorable responses we received from a few officials were quickly silenced by high political powers, who began to threaten me. The silence of the authority, in this case, was due to the fact that the mentioned field was intended to be handed over at no cost, at zero cost, without any benefit to an international mining company with serious economic problems, which will take our resources to their country through an international sale for 1 billion dollars, fact that constitutes one of the greatest robberies to the patrimony of Ecuadorians and damages to the State more serious in the history of Ecuador, led by a corrupt former Vice Minister of Mining, and he did not like that he meddles in his personal business and that journalists discover and make public all the black mud that is still hiding behind this".
"Every day in this country there are people who suffer insults and infamies and are unjustly imprisoned, because they simply do not have the resources, the will or the capital to defend themselves and fight back. The corrupt are in power, we will be the tip of that spear to ensure that this never happens again. The damage to my person, my family and my reputation has already been done, but let it be a lesson so that no one lives what I lived through".
III. From mining rights to human rights
Emiliano Donoso, De Miguel's lawyer said that "it does not matter the name of the person harmed, if he has resources or not, what he does or what his name is; it does not matter what you believe about that person, what matters is that the State cannot use its resources and all its force to affect the rights of citizens. Yesterday it was Mr. De Miguel, and tomorrow it can be me or you. It cannot happen again, the State must understand and the citizens must understand that our rights cannot be violated for nothing.
"After all this outrage, after they said that an arms dealer had an arsenal in his house, that firearms had entered the country against the security of all of us and that crimes were being committed with those weapons and that the police were confusing the public opinion that a criminal gang had been captured in which the name of Carlos De Miguel was included. The Attorney General's Office asked the judge of criminal guarantees to file the case. Why? Because after ten months they realized that there was no crime. Does it take ten months to conclude that? The judge accepted the prosecutor's file and has determined that Carlos de Miguel's constitutional rights were violated. That there was no crime and has ordered the return of the illegally seized assets.
"There are two very important facts: What are the rights of Carlos de Miguel that were violated? The Police made us believe that they listened to an anonymous complainant who had told them that there were weapons in Carlos de Miguel's house. In the country there are no anonymous denouncements, unless they are denounced by 1800 or by a protected witness. But the Police certified that it never received a complaint against De Miguel. Neither that day nor ever. They forged a supposed anonymous complaint to break into a citizen's house. And they succeeded".
DIDN'T THE POLICE HAVE ACCESS TO PUBLIC INFORMATION THAT SAID CARLOS DE MIGUEL HAD GUNS REGISTERED IN HIS NAME? OF COURSE. BUT THEY DIDN'T CARE BECAUSE THE PLAN WAS DIFFERENT: MAXIMILIANO DONOSO, CARLOS DE MIGUEL'S LAWYER.
Didn't the Police have access to the public information that said that Carlos de Miguel had weapons registered in his name? Of course they did. But they did not care because the plan was different. Once the prosecutor asked the judge to raid Mr. De Miguel's house, they arrested him, when the judge's order did not provide for any kind of arrest. And he was arrested because, according to the police, there was a flagrant crime because this man had four firearms, all of them with a permit. And what shows that the plan was to discredit and destroy this citizen, is that they told us all that there was an arsenal of weapons, and in the photos they publish two toy weapons. One is a cold laser that does not need permits, and the other is an air rifle, which is used to play pint ball and the Police made us believe that those were firearms and needed permits.
"Even though there was no flagrancy, Mr. De Miguel was subdued in his own home, when the police would not even allow him to go to the bathroom alone. He was handcuffed at his home and taken out like a criminal and put in a patrol car, where for an hour he was threatened and officer Herrera constantly told him to help him with a photograph, to collaborate with the work, that he could help him, that if not he would stay eight years in prison, that if he did not help him then he would put him in a dungeon with 28 people in full pandemic and would also lengthen the procedure as long as he could; all threats that were carried out.
"When you have seen that the Minister of Government has done before what she did: she put a tweet with the name and surname of the alleged investigated. In no other announcement (by the minister) has the full name of the investigated person been put, except in the case of Mr. Carlos De Miguel.
"Then they attacked the judge who released him. But not because she was a corrupt judge, because the Prosecutor's Office withdrew the flagrancy request, because the Police wrote in its part that there was no flagrant crime, and if there was not, why did they detain him? That illegal detention, that torture, that unjustified procedure no matter what name it has, cannot happen again.
"The Judiciary Council informed the media, news that was retweeted by the Minister of Government, that they would investigate the judge because it was a case of national interest. What was the national interest that they broke into a citizen's house and found weapons with permits?
"Subsequently, the intimidation and persecution continued: drones flying over Mr. De Miguel's house, drones flying over my home, vehicles hovering over my house on my daughter's birthday. They held press conferences where they tried to discredit me for my statements to La Posta. The minister attacked me and the media as well.
"The Council of Police Generals issued a statement in which they described Carlos de Miguel and his lawyer as enemies of the National Police. They said we were intimidating them, and how do two citizens intimidate the whole State, 56 thousand policemen? Will the Council of Generals apologize now?
"The only intention of all this was to discredit Mr. Carlos de Miguel, to destroy him, to lock him up, to slander him so that his activity at the head of a company does not bother them anymore. When this happens, the State must respond, and we sue the Ecuadorian State for the damage it has caused to this citizen", he said.
ACCORDING TO EMILIANO DONOSO, THE LAWSUIT WILL BE PRESENTED WITH ALL THE EVIDENCE AND IS ACCOMPANIED BY ALMOST 15 EXPERT REPORTS AND THE ACCUSED IS THE ECUADORIAN STATE. IF THE JUSTICE SYSTEM FINDS IN OUR FAVOR, HE SAID, THE STATE WILL REPEAT AGAINST THE OFFICIALS WHO ACTED ILLEGALLY.
Carlos de Miguel also said that "the most important thing to highlight in this lawsuit is that public officials, fully identified, used the apparatus of the State and were able to create an elaborate and anticipated process against me, to discredit me personally and my company, in order to remove an attractive offer for the State. The most important part of this lawsuit is that they must restore my reputation to the state it was in before this attack. My virtual footprint on search pages is in hundreds of articles with my name associated with arms trafficking. That has cost me that I cannot make investments in Ecuador and outside the country because the first thing they do is search my name and tell me: Mr. De Miguel, your digital footprint says that you are an arms dealer and we regret that we cannot accept your offer and we are forced to stop doing business with you. International suppliers have stopped selling to me, they have caused me damage that cannot be quantified. The most important thing is to restore my good name".
According to Emiliano Donoso, the lawsuit will be presented with all the evidence, it is accompanied by almost 15 expert reports and the defendant is the Ecuadorian State. If the justice of this country gives us the reason, he said, the State will repeat against the officials who acted illegally.
"We have to exhaust internal instances to try in international courts. However, we have made these outrages known to international human rights organizations and we have presented an informative claim to the IACHR. Regardless of what the national justice system says, we will go to international instances, because the Ecuadorian State must be internationally sanctioned, said Donoso.
Carlos de Miguel, at the press conference in Quito.
IV. The accusation has been disproved
According to María Paula Romo, she did not find out about the operation until later, because the decision to raid had been taken by the Prosecutor's Office. Therefore, she has denied responsibility on the matter. The Police Weapons and Explosives Investigation Unit (Uidan) carried out the operation in the home of Carlos de Miguel, in Puembo. They carried a search warrant from a judge and were accompanied by a prosecutor. The motivation? An alleged anonymous complaint of illegal arms trafficking. Later, De Miguel's defense would denounce and show evidence that there was never such a complaint.
Four firearms were found: a Glock 9 millimeter pistol, an M4 Colt rifle, a Colt pistol, a Mossberg shotgun. Also 19 feeders, 9,500 rounds of ammunition and two training devices. The weapons were properly stored, unloaded and without their respective feeders, De Miguel said.
Among the weapons was an M4 assault carbine, the U.S. Army's standard issue infantry main weapon, and used by elite police units. De Miguel bought it in the U.S. in 2003. According to his biography, he was trained by the U.S. Navy's elite SEALs.
The Glock had a permit valid until 2024, but the permits for the other three weapons were expired. His defense later said those permits were pending.
"According to De Miguel, he bought the ammunition in mid-2019 from Ricardo Lopez, who in turn had purchased it from the Santa Barbara factory. Until last May, Lopez, who is a world shooting champion, worked at Hanrine as assistant manager, in charge of security tasks. He left the company amid disagreements and setbacks with the manager of Hanrine," reported the website Código Vidrio, the journalist Arturo Torres.
AFTER THE FLAGRANCY HEARING, JUDGE GEOVANNA PALACIOS ORDERED HIS RELEASE AND THE PROSECUTOR'S OFFICE OPENED A PRELIMINARY INVESTIGATION FOR ILLICIT ARMS TRAFFICKING. THE JUDICIARY COUNCIL IMMEDIATELY ANNOUNCED THAT IT WOULD INVESTIGATE THE JUDGE FOR HER DECISION, AS IT WAS "A MATTER OF NATIONAL INTEREST".
In the same report, Torres revealed that De Miguel had said that "the permits have been renewed several times by the Joint Command; I bought the ammunition, which is of the same caliber as the weapons, for shooting practice and to compete in tournaments, inside and outside the country; I am a member of several clubs in Guayas and Imbabura.
But, according to a report from the Department of Arms Control of the Joint Command of the Armed Forces to which the portal had access, De Miguel did not have permits for sporting use and possession for three firearms: a carbine, a shotgun and a pistol, which were in force until 2017.
The renewal request had been denied for having detected "that the user possessed four previous ID numbers registered in Sinocar", according to a July 2020 report.
"On May 21 -with official letter 20-G-4-ARMAS-Pich-Insp-032- the user was notified that his request was cancelled as it did not meet the requirements. The official letter was sent by e-mail and to date no response has been received, nor was it possible to locate the user," the portal reported.
After the flagrancy hearing, which took place the following day, Judge Geovanna Palacios, who ordered his release and opened a preliminary investigation for illicit arms trafficking. The Judiciary Council immediately announced that it would investigate the judge for her decision, as it was a matter of "national interest".
News from El Comercio on the unusual position of the Judiciary Council on this issue. View PDF
On the same day, the Minister of Government, María Paula Romo, informed on her Twitter account about the operation and the arrest of De Miguel, as well as the execution of the proceeding.
De Miguel, together with his lawyer, Emiliano Donoso, filed a complaint for procedural fraud against Romo. The prosecutor who led the operation, Washington Rojas; Judge Eliana Carvajal, who ordered the raid, and seven police officers and operatives were also accused. In the core part, the accuser pointed out that the police action was about "setting up a state structure to persecute me and mount illegal evidence, in order to attack my name and reputation for the economic activity I carry out".
According to the hypothesis of senior officials of the company, in the background was a dispute for 51% of the shares of the Llurimagua project, a dispute involving people related to senior government officials, such as Francisco Roldán, uncle of the then Cabinet Secretary and strong man of Carondelet, Juan Sebastián Roldán, all of which was denied by those involved.
Criminal complaint filed by De Miguel against those who participated in the raid. Ver PDF
In response, no less than the Council of Generals of the Police issued a public communiqué supporting the action of its members. The police high command said that De Miguel had to prove his claims, constant in his complaint, that evidence had been mounted against him with other interests. And that "according to the presumption of innocence, the accused should demonstrate before the justice system the legality of his actions". This, according to De Miguel's defense, violates the due process and constitutional rights of protection, since it is the Prosecutor's Office that must demonstrate with evidence the illegality of the acts of the citizens.
Statement of the Council of Generals of the National Police, in which the high command rejected the affirmations of De Miguel in his denunciation. The Police supported the actions of its members.
Emiliano Donoso, De Miguel's defender, issued a letter to the Council of Generals, in which he explained point by point the irregularities that they detected in the process. Especially facts such as the fact that De Miguel's arrest was made without an arrest warrant from a competent judge, and then it was certified in the same police report that there was no flagrancy.
Letter from Emiliano Donoso, De Miguel's lawyer, in response to the statement of the Council of Generals of the National Police. View PDF
In March 2021, the Attorney General's Office itself asked the judge to file the case. According to the brief:
The crime of illicit trafficking of firearms, chemical, nuclear or biological weapons, is a crime of mere activity, therefore the legal norm is focused to protect the traffic and the right of property on this type of objects, establishing for this purpose its restriction on the fact of developing, producing, manufacturing, employing, acquiring, acquiring, possessing, distributing, storing, conserving, transporting, transiting, importing, exporting, re-exporting or commercializing firearms, their parts and components, ammunition and explosives, as long as the competent authorization DOES NOT EXIST. Therefore, upon analyzing the present case, it is clear that if the investigated party, with respect to the evidence seized, according to the information gathered in the case file, had expired permits or was in the process of renewing them, his actions would not constitute a conduct that fits this type of crime, but rather an administrative infraction that can be prosecuted by the competent authority for not having regulated the validity of his permits.
In the present case, in relation to the analysis of the type and when verifying the dogmatic categories, starting with the evaluation of the act and verifying if it can be subsumed in the conduct of the criminal type investigated to determine if the facts fit the typical description, it is determined that the configuration of the Typicity is not fulfilled, therefore it becomes unnecessary to continue with the analysis of the following dogmatic categories, in terms of antijuridicity and culpability in accordance with the provisions of Art. 18 of the COIP, if the act itself does not constitute a crime. The above is determined by all the elements collected within the investigation, I am referring to the different versions, documentation required by the prosecution and incorporated by the investigated, the expert reports made, and especially the information provided by the Joint Command of the Armed Forces and the Logistics Directorate of the Army. AA LOGISTICS DIRECTION WEAPONS CONTROL DEPARTMENT on the status of the permits for possession and sport use of firearms that were conferred by the competent authority in favor of Mr. DE MIGUEL III CARLOS MIGUEL, which in the opinion of the undersigned prosecutor, exclude the unlawfulness of the conduct described in the type, thus making it impossible to obtain elements regarding the materiality of the infraction or the responsibility. From the analysis of the investigation, it is determined that in compliance with the objective duty of the prosecution, it has been possible to obtain elements that justify that the firearms and ammunition owned by the investigated DE MIGUEL III CARLOS MIGUEL, and that were seized as evidence during the raid carried out in his domicile, according to the information sent by the JOINT COMMAND OF THE ARMED FORCES, they have permits and the status of them, by virtue of their recreational shooting activity, with respect to which there is also documentation that accredits their affiliations to the respective Shooting Clubs for said activity, reason for which the undersigned prosecutor analyzes that neither the objective nor subjective elements of the type described in Art. 362 of the Organic Integral Criminal Code, therefore, considering also the ballistic expert report elaborated by Luis Damian, it is concluded that the ammunition seized as evidence is apt to be used in each of the firearms also seized in the case.
Regarding the aforementioned, the principle of legality contemplated in Art. 76 numeral 3 of the Constitution of the Republic in relation to article 5 numeral 1 of the Organic Integral Criminal Code and article 13 numeral 2 and 3 of the same legal norm, which clearly establishes that the penal types and penalties shall be interpreted strictly, that is, respecting the literal sense of the norm, being also prohibited the use of analogy to create penal infractions, to extend the limits of the legal presuppositions that allow the application of a sanction or precautionary measure or to establish exceptions or restrictions of rights.
With the legal basis and the legal factual analysis exposed and of the investigations carried out in the present Preliminary Investigation; by virtue of the constitutional and legal antecedents mentioned; and, consequently, the objective presupposition of the materiality of the criminal type analyzed that orients the activity of collection of evidentiary elements in the criminal field in accordance with the provisions of Art.453 of the Organic Integral Criminal Code; being so, the obligation to crystallize in the first place the existence of the infraction is not configured with sufficient elements in this case; consequently, being an indispensable element in the configuration of the act as criminal, the existence of willfulness or positive action to cause damage and of the causal nexus between the human conduct, which goes to the detriment of a legal good protected by society and those responsible for the fact, situation that has not been proven in the investigation file as I have indicated in previous lines, in accordance with the principles of minimum intervention, procedural economy, celerity, in accordance with the provisions of Art. 586, numeral 2 of the Organic Integral Criminal Code…
Judge's ruling, dismissing the case against De Miguel for trafficking in firearms, chemical, biological and nuclear weapons. View PDF
The judge closed the case because there was no crime.
When asked if De Miguel was still interested in Llurimagua, he said: "The company is very interested. The object of our investment is large-scale copper projects. In the new era of reducing fuel use, electric cars are now a reality. The electric car uses five times more copper than a gasoline car. Copper is still the best conductor of electricity in the world. People need energy in their homes. Copper is the future of hydrocarbon reduction worldwide and we are very interested in any deposits or reserves of this important mineral."
Translated by Manuel Novik